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In past two years, the market value of Venky’s (India) zoomed 1610% from Rs 265 on back of the improved financial performance. On comparison, the benchmark Sensex was up 43.6% during the period.
For the first nine months April to December(9MFY18) of the current financial year 2017-18 (FY18), Venky’s (India) reported 79% year-on-year (YoY) growth in net profit to Rs 1,485 million against Rs 830 million during the same period of previous financial year 2016-17 (FY17). The company had posted net profit of Rs 1,248 million in entire FY17.
After reporting 45% YoY decline in net profit at Rs 187 million in FY15, Venky’s (India) posted more-than-double net profit of Rs 382 million in FY16.
EBITDA (earnings before interest, tax, depreciation and amortized expenses) margin also improved from 5.9% in FY15 to 6.4% in FY16 and 11.2% in FY17. EBITDA margin for 9MFY18 stood at 14.8% against 10.1% in 9MFY17.
“Better realizations for the poultry and poultry products segment helped the segment to register the improved performance as compared to the previous year. The performance of the oilseed segment was also better as compared to the previous year due to higher capacity utilization and better realisation,” Anuradha Desai, Chairperson, Venky’s (India) said in FY17 annual report.
Analysts at Quantum Securities believe Venky’s is in a good spot with benign raw material prices and robust poultry prices. However, the stock is trading above its target price of Rs 3,498.
At 01:07 pm; Venky’s trading 12% higher at Rs 4,404 on the BSE, as compared to 0.08% decline in the S&P BSE Sensex. The trading volumes on the counter surged more than four-fold with a combined 1.45 million equity shares representing 10% of total equity of the company changed hands on the BSE and NSE so far.